Note O—Commitments and Contingencies

1. Operating Leases

The Company leases its operations facility for a term expiring on October 31, 2025, and leases its Philadelphia offices for a term expiring in 2025. The Company also has leases for business production offices in Pennsylvania, Maryland, Florida, Washington and Minnesota that expire at various times through 2018. The Company leases space in South Dakota, USA, Gibraltar and Bulgaria for its prepaid card division. The leases on these spaces expire at various times through 2022. The Company leases space in Illinois for its Small Business Lending division for a term expiring in 2020. The Company leases space in Florida for compliance operations for a term expiring in 2020. The Company leases executive office space in New York for a term expiring in 2025. The Company leases a sales office in San Francisco, California for its payments businesses which expires in 2020. These leases require the Company to pay the real estate taxes and insurance on the leased properties in addition to rent. The approximate future minimum annual rental payments, including any additional rents due to escalation clauses, required by these leases are as follows (in thousands):


Year ending December 31,

2016		$ 3,805
2017		3,933
2018		3,890
2019		3,960
2020		3,898
Thereafter		14,720
		$ 34,206

Rent expense for the years ended December 31, 2015, 2014 and 2013 was approximately $4.6 million, $4.0 million and $3.1 million, net of sublease rentals of approximately $0, $78,000 and $110,000, respectively. The sublease expired in 2014.

Legal Proceedings

On July 17, 2014, a class action securities complaint captioned Fletcher v. The Bancorp Inc., et al., was filed in the United States District Court for the District of Delaware. A consolidated version of that class action complaint was filed before the same court on January 23, 2015 on behalf of Lead Plaintiffs Arkansas Public Employees Retirement System and Arkansas Teacher Retirement System under the caption of In re The Bancorp Inc. Securities Litigation. On October 26, 2015, Lead Plaintiffs filed an amended consolidated complaint against the Company, Betsy Z. Cohen, Paul Frenkiel, Frank M. Mastrangelo and Jeremy Kuiper, which alleges that during a class period beginning January 26, 2011 through June 26, 2015, the defendants made materially false and/or misleading statements and/or failed to disclose that (i) the Company had wrongfully extended and modified problem loans and under-reserved for loan losses due to adverse loans, (ii) the Company’s operations and credit practices were in violation of the BSA, and (iii) as a result, the Company’s financial statements, press releases and public statements were materially false and misleading during the relevant period. The amended consolidated complaint further alleges that, as a result, the price of the Company’s common stock was artificially inflated and fell once the defendants’ misstatements and omissions were revealed, causing damage to the plaintiffs and the other members of the class. The complaint asks for an unspecified amount of damages, prejudgment and post-judgment interest and attorneys’ fees. The defendants filed a motion to dismiss the amended consolidated complaint on November 23, 2015. Oral argument on the defendants’ motion was held on January 29, 2016. This litigation is in its preliminary stages. The Company has been advised by its counsel in the matter that reasonably possible losses cannot be estimated. The Company believes that the complaint is without merit and intends to continue to defend vigorously.

In addition, the Company is a party to various routine legal proceedings arising out of the ordinary course of its business. The Company believes that none of these actions, individually or in the aggregate, will have a material adverse effect on our financial condition or operations.